IP survey results - UK businesses in the IP spotlight

For a number of years now we have been working in collaboration with the magazines New Electronics and Eureka to increase the level of understanding of what IP is and how it can be valuable to businesses. In support of this initiative we have been running IP surveys inviting the readerships of both magazines to answer questions about their perceptions and experiences of IP. We have now studied the results of this year's IP survey, which gives an interesting insight into the issues facing businesses and their concerns.

Are UK businesses protecting and exploiting their IP?

It is worth first noting that the size of businesses that responded to the survey varied considerably. For example, 22% of respondents work in businesses with 500+ employees. At the other end of the scale, 43% work in businesses with 1 to 49 employees.

One of the questions posed was: "To what extend does your business actively assess your IP position in terms of identifying IP and/or protecting it?". This year we again found a low percentage of just over 50% of respondents who actively look at their IP position. This might be because of the spread of business sizes responding to the survey, with larger companies being more likely to monitor and assess their IP position.

In terms of respondents' views on whether they thought their IP is sufficiently protected, the figure is also low at 53%. The remaining respondents to this question either didn't know or confirmed their IP was not adequately protected. Again, this may be because of smaller companies either not being in a position to register their IP rights or through lack of understanding. Pairing this against the figure of 91% of respondents who claimed that they did understand what IP they possess, suggests that many businesses are actively deciding against registering their IP in the form of patents for example.

Exploitation of IP remains largely static at 53% of respondents – an impressive statistic if over half of those surveyed are actively making IP work for them.

What IP issues are worrying UK businesses?

The first concern was largely expected, this being the cost and time consumption required to secure IP rights. This has been cited in previous years.

It is impossible to avoid some non-trivial costs of securing a monopoly right, particularly if international portfolios are sought. However, for protection in the UK, the UK Intellectual Property Office (UKIPO) remains remarkably good value. For example, the UK Government fees to file, search and examine an application are some of the lowest in the world. Combine this with an appropriate claim scope, in line with the commercial interests of the applicant, and the actual cost of securing protection in the UK can be really very good value.

Furthermore, using initiatives such as the UK's green channel to accelerate prosecution, a patent can be filed, searched, examined and granted in a remarkably short period – as quickly as six months in extreme circumstances (subject to early publication). Protection can then be quickly extended using the network of 'patent prosecution highways'.

The second issue which features prominently this year is the issue of employees leaving and taking valuable know-how with them to competitors. This is a very difficult area for businesses, particularly in fast moving high-tech fields. Employer/employee relationships in terms of IP vary dramatically across Europe. In the UK for example an invention made in the normal course of employment is owned by the employer, who can decide what, if anything, to do with it. In Germany things are very different. Under German law if an employer does not file a patent application to an invention then the right to apply reverts to the employee. It means that in Germany many businesses are forced to file patent applications purely as a precaution to ensure that all developments remain the property of the business.

Outsourced R&D and design also appeared as a prominent concern. In particular, companies are concerned about designers taking their learning and subsequently working for competitors.

However, by far the most frequent concern facing respondents is the perceived dangers posed by Chinese companies. This includes concerns relating to manufacturing in China and more specifically Chinese companies copying products and importing them back into domestic markets. Many companies design in the UK and manufacture all or sub-components of their products in China. Cases such as Land Rover Evoque v Landwind X7 (see www.dyoung.com/article-evoquex7) cause concern for potential users of the IP system in China. The particular problem Land Rover faced was caused by the narrow scope of design protection in China, which is not the case for patents.

It is clear from our survey that respondents have concerns about operating in China, but are reluctant to extend their patent portfolios into China, assuming of course that they even have domestic IP. Perhaps one solution in respect of China is for applicants to explore the Chinese utility patent, which is a very popular system in China itself. Clearly the scope of protection is narrower than a normal patent, but it offers significant advantages in terms of speed and cost, two of the main concerns about IP.

Overall the feedback on IP was positive in the sense that an increasing number of businesses are aware of what IP they have and many are making good use of it. We hope that continuing our collaboration with Eureka and New Electronics will further enhance SMEs' confidence in and understanding of IP, ultimately safeguarding the investment they are making in UK-based R&D.

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